Market Newsdesk

SelectQuote, Inc. Reports Fourth Quarter 2021 and Fiscal Year 2021 Results

Fourth Quarter of Fiscal Year 2021 – Consolidated Earnings Highlights

• Revenue of $188.4 million, Up 33% Year-Over-Year
• Net Income of $3.3 million, Down $16.7 million Year-Over-Year
• Adjusted EBITDA of $21.3 million, Down 47% Year-Over-Year*

Fourth Quarter of Fiscal Year 2021 – Segment Highlights

Senior

• Revenue of $124.4 million, Up 42% Year-Over-Year
• Adjusted EBITDA of $24.8 million, Down 26% Year-Over-Year*
• Approved Medicare Advantage policies grew 54% Year-Over-Year

Life

• Revenue of $59.9 million, Up 41% Year-Over-Year
• Final expense premiums grew 79% Year-Over-Year

Auto & Home

• Revenue of $7.2 million, Down 41% Year-Over-Year
• Total Auto & Home premiums declined 37% Year-Over-Year

OVERLAND PARK, Kan.–(BUSINESS WIRE)–
SelectQuote, Inc. (NYSE: SLQT), reported consolidated revenue for the fourth quarter of fiscal year 2021 of $188.4 million, which was a 33% increase year-over-year. Consolidated net income for the fourth quarter of fiscal year 2021 was $3.3 million, which was a $16.7 million decrease year-over-year. Finally, consolidated Adjusted EBITDA for the fourth quarter of fiscal year 2021 was $21.3 million, which was a 47% decrease year-over-year.

Consolidated revenue for the fiscal year ended June 30, 2021, was $937.8 million, a 76% increase over consolidated revenue for the fiscal year ended June 30, 2020, of $531.5 million. Consolidated net income for the fiscal year ended June 30, 2021, was $131.0 million, an increase of $49.9 million over consolidated net income for the fiscal year ended June 30, 2020, of $81.1 million. Finally, consolidated Adjusted EBITDA for the fiscal year ended June 30, 2021, was $228.0 million compared to consolidated Adjusted EBITDA of $154.0 million for the fiscal year ended June 30, 2020, a 48% increase.

Chief Executive Officer Tim Danker commented, “2021 was a landmark year for SelectQuote both in terms of our growth but also in the significant opportunity established through the initiation of our Population Health strategy. For the full year we grew Adjusted EBITDA by $74.0 million or nearly 50% following growth of 46% in 2020. We continue to have high conviction in our differentiated model and our ability to scale quality growth in 2022 and beyond. We believe that SelectQuote’s strong connection with our end customers creates differentiated value and we expect Population Health to strengthen that bond in the years to come.”

Chief Financial Officer Raffaele Sadun added, “Our Senior full-year revenues grew 101% year-over-year, which follows full-year growth of 88% in fiscal 2020. New MA approved policies also grew in excess of 100% at attractive unit economics with a Revenue to CAC of 3.0x. Our MA LTV was down 2% for the year, which includes a full-year true-up in our 4th Quarter results for additional provision due to higher than expected intra-year lapse rates. Despite some persistency pressure compared to original expectations, we expect cohort-level IRRs to remain very attractive.”

*See reconciliation from non-GAAP measure, Adjusted EBITDA, to net income on pages 11-12.

Segment Results

We currently report on three segments: 1) Senior, 2) Life and 3) Auto & Home. The performance measures of the segments include total revenue and Adjusted EBITDA. Costs of revenue, marketing and advertising, and technical development operating costs and expenses that are directly attributable to a segment are reported within the applicable segment. Indirect costs of revenue, marketing and advertising, and technical development operating costs and expenses are allocated to each segment based on varying metrics such as headcount. Adjusted EBITDA is calculated as total revenue for the applicable segment less direct and allocated costs of revenue, marketing and advertising, technical development, and general and administrative operating costs and expenses, excluding depreciation and amortization expense; gain or loss on disposal of property, equipment, and software; share-based compensation expense; restructuring expenses; and non-recurring expenses such as severance payments and transaction costs.

Senior

Financial Results

The following table provides the financial results for the Senior segment for the periods presented:

(in thousands)	4Q 2021				4Q 2020				% Change			FY 2021				FY 2020				% Change
Revenue	$	124,391			$	87,865			42	%		$	728,701			$	361,673			101	%
Adjusted EBITDA*	24,830				33,387				(26)	%		243,777				145,738				67	%
Adjusted EBITDA Margin*	20		%		38		%					33		%		40		%

Operating Metrics

Submitted Policies

Submitted policies are counted when an individual completes an application with our licensed agent and provides authorization to them to submit it to the insurance carrier partner. The applicant may have additional actions to take, such as providing additional information, before the application will be reviewed by the insurance carrier, such as providing additional information.

The following table shows the number of submitted policies for the periods presented:

	4Q 2021			4Q 2020			% Change			FY 2021			FY 2020			% Change
Medicare Advantage	95,549			59,276			61	%		550,321			264,546			108	%
Medicare Supplement	2,498			7,702			(68)	%		26,785			24,085			11	%
Dental, Vision and Hearing	30,287			17,212			76	%		132,106			70,018			89	%
Prescription Drug Plan	1,193			2,378			(50)	%		11,436			13,513			(15)	%
Other	3,884			2,278			71	%		16,487			5,890			180	%
Total	133,411			88,846			50	%		737,135			378,052			95	%

*See reconciliation from non-GAAP measure, Adjusted EBITDA, to net income on pages 11-12.

Approved Policies

Approved policies represents the number of submitted policies that were approved by our insurance carrier partners for the identified product during the indicated period. Not all approved policies will go in force.

The following table shows the number of approved policies for the periods presented:

	4Q 2021			4Q 2020			% Change			FY 2021			FY 2020			% Change
Medicare Advantage	83,448			54,305			54	%		467,585			225,404			107	%
Medicare Supplement	2,062			6,362			(68)	%		21,911			18,102			21	%
Dental, Vision and Hearing	26,645			16,564			61	%		111,015			55,556			100	%
Prescription Drug Plan	1,191			2,481			(52)	%		10,747			13,009			(17)	%
Other	3,880			2,058			89	%		14,089			4,654			203	%
Total	117,226			81,770			43	%		625,347			316,725			97	%

Lifetime Value of Commissions per Approved Policy

Lifetime value of commissions per approved policy represents commissions estimated to be collected over the estimated life of an approved policy based on multiple factors, including but not limited to, contracted commission rates, carrier mix and expected policy persistency with applied constraints. The lifetime value of commissions per approved policy is equal to the sum of the commission revenue due upon the initial sale of a policy, and when applicable, an estimate of future renewal commissions.

The following table shows the lifetime value of commissions per approved policy for the periods presented:

(dollars per policy):	4Q 2021				4Q 2020				% Change			FY 2021				FY 2020				% Change
Medicare Advantage	$	1,121			$	1,256			(11)	%		$	1,260			$	1,287			(2)	%
Medicare Supplement	1,323				1,382				(4)	%		1,269				1,376				(8)	%
Dental, Vision and Hearing	121				125				(3)	%		136				140				(3)	%
Prescription Drug Plan	180				226				(20)	%		224				229				(2)	%
Other	160				(48)				(436)	%		113				34				232	%

Per Unit Economics

Per unit economics represents total Medicare Advantage and Medicare Supplement commissions, other product commissions, other revenues, and costs associated with the Senior segment, each shown as per number of approved Medicare Advantage and Medicare Supplement approved policies over a given time period. Management assesses the business on a per unit basis to help ensure that the revenue opportunity associated with a successful policy sale is attractive relative to the marketing acquisition cost. Because not all acquired leads result in a successful policy sale, all per policy metrics are based on approved policies, which is the measure that triggers revenue recognition.

The Medicare Advantage and Medicare Supplement commission per MA/MS policy represents the lifetime value of commissions for policies sold in the period. Other commission per MA/MS policy represents the lifetime value of commissions for other products sold in the period, including dental, vision and hearing, prescription drug plan, and other products, which management views as additional commission revenue on our agents’ core function of MA/MS policy sales. Other per MA/MS policy represents the production bonuses, lead sales revenue from InsideResponse, and updated estimates of prior period variable consideration based on actual policy renewals in the current period. Total operating expenses per MA/MS policy represent all of the operating expenses within the Senior segment. The Revenue to customer acquisition cost (“CAC”) multiple represents total revenue per MA/MS policy as a multiple of total marketing acquisition cost, which represents the direct costs of acquiring leads which is included in marketing and advertising expense within the total operating expenses per MA/MS policy.

The following table shows per unit economics for the periods presented. Based on the seasonality of the Senior segment and the fluctuations between quarters, we believe that the most relevant view of per unit economics is on a rolling 12-month basis. All per MA/MS policy metrics below are based on the sum of approved MA/MS policies, as both products have similar commission profiles. These metrics are the basis on which management assesses the business:

	Twelve Months Ended June 30,
(dollars per approved policy):	2021				2020				% Change
Medicare Advantage and Medicare Supplement approved policies	489,496				243,506				101	%
Medicare Advantage and Medicare Supplement commission per MA / MS policy	$	1,260			$	1,293			(3)	%
Other commission per MA/MS policy	39				45				(13)	%
Other per MA / MS policy	190				147				29	%
Total revenue per MA / MS policy	1,489				1,485				0	%
Total operating expenses per MA / MS policy	(991)				(887)				12	%
Adjusted EBITDA per MA / MS policy*	$	498			$	598			(17)	%
Adjusted EBITDA Margin per MA / MS policy*	33		%		40		%		(17)	%
Revenue / CAC multiple	3.0X				3.5X

Life

Financial Results

The following table provides the financial results for the Life segment for the periods presented:

(in thousands)	4Q 2021				4Q 2020				% Change			FY 2021				FY 2020				% Change
Revenue	$	59,905			$	42,423			41	%		$	185,503			$	129,967			43	%
Adjusted EBITDA*	10,310				12,258				(16)	%		30,376				27,812				9	%
Adjusted EBITDA Margin*	17		%		29		%					16		%		21		%

Operating Metrics

Life premium represents the total premium value for all policies that were approved by the relevant insurance carrier partner and for which the policy document was sent to the policyholder and payment information was received by the relevant insurance carrier partner during the indicated period. Core premiums include term life and permanent life insurance policies while ancillary premiums include various smaller products. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for our Life segment.

*See reconciliation from non-GAAP measure, Adjusted EBITDA, to net income on pages 11-12.

The following table shows core, final expense, and ancillary premiums for the periods presented:

(in thousands)	4Q 2021				4Q 2020				% Change			FY 2021				FY 2020				% Change
Core Premiums	$	19,983			$	18,965			5	%		$	76,251			$	75,451			1	%
Final Expense Premiums	33,700				18,860				79	%		88,294				34,839				153	%
Ancillary Premiums	976				732				33	%		3,166				2,507				26	%

Auto & Home

Financial Results

The following table provides the financial results for the Auto & Home segment for the periods presented:

(in thousands)	4Q 2021				4Q 2020				% Change			FY 2021				FY 2020				% Change
Revenue	$	7,161			$	12,127			(41)	%		$	30,913			$	41,189			(25)	%
Adjusted EBITDA*	1,316				3,104				(58)	%		8,178				8,699				(6)	%
Adjusted EBITDA Margin*	18		%		26		%					26		%		21		%

Operating Metrics

Auto & Home premium represents the total premium value of all new policies that were approved by our insurance carrier partners during the indicated period. Because our commissions are earned based on a percentage of total premium, total premium volume for a given period is the key driver of revenue for our Auto & Home segment.

The following table shows premiums for the periods presented:

(in thousands):	4Q 2021				4Q 2020				% Change			FY 2021				FY 2020				% Change
Premiums	$	13,431			$	21,162			(37)	%		$	55,596			$	70,087			(21)	%

*See reconciliation from non-GAAP measure, Adjusted EBITDA, to net income on pages 11-12.

Earnings Conference Call

SelectQuote, Inc. will host a conference call with the investment community today, Wednesday, August 25, 2021, beginning at 5 p.m. ET. To register for this conference call, please use this link: http://www.directeventreg.com/registration/event/8844709. After registering, a confirmation will be sent via email, including dial in details and unique conference call codes for entry. Registration is open through the live call, but to ensure you are connected for the full call we suggest registering a day in advance or at minimum 10 minutes before the start of the call. The event will also be webcasted live via our investor relations website https://ir.selectquote.com/investor-home/default.aspx.

Non-GAAP Financial Measures

This release includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. To supplement our financial statements presented in accordance with GAAP and to provide investors with additional information regarding our GAAP financial results, we have presented in this release Adjusted EBITDA and Adjusted EBITDA Margin, which are non-GAAP financial measures. These non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similarly titled measures presented by other companies. We define Adjusted EBITDA as income before interest expense, income tax expense, depreciation and amortization, and certain add-backs for non-cash or non-recurring expenses, including restructuring and share-based compensation expenses. The most directly comparable GAAP measure is net income. We monitor and have presented in this release Adjusted EBITDA because it is a key measure used by our management and Board of Directors to understand and evaluate our operating performance, to establish budgets and to develop operational goals for managing our business. In particular, we believe that excluding the impact of these expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of our core operating performance.

We believe that this non-GAAP financial measure helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in the calculations of this non-GAAP financial measure. Accordingly, we believe that this financial measure provides useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects.

Forward Looking Statement

This release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.

There are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the following: the ultimate duration and impact of the ongoing COVID-19 pandemic, our reliance on a limited number of insurance carrier partners and any potential termination of those relationships or failure to develop new relationships; existing and future laws and regulations affecting the health insurance market; changes in health insurance products offered by our insurance carrier partners and the health insurance market generally; insurance carriers offering products and services directly to consumers; changes to commissions paid by insurance carriers and underwriting practices; competition with brokers, exclusively online brokers and carriers who opt to sell policies directly to consumers; competition from government-run health insurance exchanges; developments in the U.S. health insurance system; our dependence on revenue from carriers in our senior segment and downturns in the senior health as well as life, automotive and home insurance industries; our ability to develop new offerings and penetrate new vertical markets; risks from third-party products; failure to enroll individuals during the Medicare annual enrollment period; our ability to attract, integrate and retain qualified personnel; our dependence on lead providers and ability to compete for leads; failure to obtain and/or convert sales leads to actual sales of insurance policies; access to data from consumers and insurance carriers; accuracy of information provided from and to consumers during the insurance shopping process; cost-effective advertisement through internet search engines; ability to contact consumers and market products by telephone; global economic conditions; disruption to operations as a result of future acquisitions; significant estimates and assumptions in the preparation of our financial statements; impairment of goodwill; potential litigation and claims, including IP litigation; our existing and future indebtedness; developments with respect to LIBOR; access to additional capital; failure to protect our intellectual property and our brand; fluctuations in our financial results caused by seasonality; accuracy and timeliness of commissions reports from insurance carriers; timing of insurance carriers’ approval and payment practices; factors that impact our estimate of the constrained lifetime value of commissions per policyholder; changes in accounting rules, tax legislation and other legislation; disruptions or failures of our technological infrastructure and platform; failure to maintain relationships with third-party service providers; cybersecurity breaches or other attacks involving our systems or those of our insurance carrier partners or third-party service providers; our ability to protect consumer information and other data; and failure to market and sell Medicare plans effectively or in compliance with laws. For a further discussion of these and other risk factors that could impact our future results and performance, see the section entitled “Risk Factors” in the most recent Annual Report on Form 10-K (the “Annual Report”) filed by us with the Securities and Exchange Commission. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and, except as otherwise required by law, we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

About SelectQuote:

Founded in 1985, SelectQuote (NYSE: SLQT) provides solutions that help consumers protect their most valuable assets: their families, health and property. The company pioneered the direct-to-consumer model of providing unbiased comparisons from multiple, highly-rated insurance companies allowing consumers to choose the policy and terms that best meet their unique needs. Two foundational pillars underpin SelectQuote’s success: a strong force of highly-trained and skilled agents who provide a consultative needs analysis for every consumer, and proprietary technology that sources, scores, and routes high-quality sales leads. The company has three core business lines: SelectQuote Senior, SelectQuote Life and SelectQuote Auto and Home. SelectQuote Senior, the largest and fastest-growing business, serves the needs of a demographic that sees 10,000 people turn 65 each day with a range of Medicare Advantage and Medicare Supplement plans from leading, nationally-recognized carriers, as well as prescription drug plans, dental, vision and hearing plans.

SELECTQUOTE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands)
	June 30,
	2021				2020
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	286,454			$	321,065
Restricted cash	—				47,805
Accounts receivable	113,375				83,634
Commissions receivable-current	89,120				51,209
Other current assets	4,486				10,121
Total current assets	493,435				513,834
COMMISSIONS RECEIVABLE—Net	756,777				461,752
PROPERTY AND EQUIPMENT—Net	29,510				22,150
SOFTWARE—Net	12,611				8,399
OPERATING LEASE RIGHT-OF-USE ASSETS	31,414				—
INTANGIBLE ASSETS—Net	40,670				19,673
GOODWILL	68,019				46,577
OTHER ASSETS	1,436				1,408
TOTAL ASSETS	$	1,433,872			$	1,073,793
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	34,079			$	22,891
Accrued expenses	20,676				14,936
Accrued compensation and benefits	40,909				22,228
Earnout liability	—				30,812
Operating lease liabilities—current	5,289				—
Other current liabilities	7,864				4,944
Total current liabilities	108,817				95,811
DEBT	459,043				311,814
DEFERRED INCOME TAXES	140,988				105,844
OPERATING LEASE LIABILITIES	38,392				—
OTHER LIABILITIES	11,743				14,635
Total liabilities	758,983				528,104
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $.01 par value	1,635				1,622
Additional paid-in capital	544,771				548,113
Retained earnings (accumulated deficit)	128,254				(2,792)
Accumulated other comprehensive income (loss)	229				(1,254)
Total shareholders’ equity	674,889				545,689
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,433,872			$	1,073,793

SELECTQUOTE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (In thousands)
	Three Months Ended June 30,								Year Ended June 30,
	2021				2020				2021				2020
REVENUE:
Commission	$	162,294			$	122,679			$	826,606			$	476,606
Production bonus and other	26,155				18,768				111,209				54,909
Total revenue	188,449				141,447				937,815				531,515
OPERATING COSTS AND EXPENSES:
Cost of revenue	64,110				40,911				270,715				167,399
Marketing and advertising	86,595				51,911				385,291				184,157
General and administrative	18,618				9,504				63,114				35,283
Technical development	5,165				3,259				18,623				12,347
Total operating costs and expenses	174,488				105,585				737,743				399,186
INCOME FROM OPERATIONS	13,961				35,862				200,072				132,329
INTEREST EXPENSE, NET	(8,422)				(8,356)				(29,320)				(24,595)
LOSS ON EXTINGUISHMENT OF DEBT	—				(1,166)				(3,315)				(1,166)
OTHER EXPENSES, NET	(43)				(385)				(1,588)				(405)
INCOME BEFORE INCOME TAX EXPENSE	5,496				25,955				165,849				106,163
INCOME TAX EXPENSE	2,184				5,906				34,803				25,016
NET INCOME	$	3,312			$	20,049			$	131,046			$	81,147
NET INCOME (LOSS) PER SHARE:
Basic	$	0.02			$	0.15			$	0.80			$	(0.16)
Diluted	$	0.02			$	0.13			$	0.79			$	(0.16)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic	163,441				120,018				162,889				97,496
Diluted	165,689				152,404				165,544				97,496
OTHER COMPREHENSIVE (LOSS) INCOME NET OF TAX:
(Loss) gain on cash flow hedge	(186)				(1,254)				1,483				(1,254)
OTHER COMPREHENSIVE (LOSS) INCOME	(186)				(1,254)				1,483				(1,254)
COMPREHENSIVE INCOME	$	3,126			$	18,795			$	132,529			$	79,893

SELECTQUOTE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)
	Three Months Ended June 30,								Year Ended June 30,
	2021				2020				2021				2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	3,312			$	20,049			$	131,046			$	81,147
Adjustments to reconcile net income to net cash, cash equivalents, and restricted cash used in operating activities:
Depreciation and amortization	4,883				2,720				16,142				7,993
Loss on disposal of property, equipment, and software	425				125				686				360
Share-based compensation expense	1,476				216				5,165				9,498
Deferred income taxes	2,180				5,889				34,654				25,007
Amortization of debt issuance costs and debt discount	862				835				3,344				2,266
Write-off of debt issuance costs	—				237				2,570				237
Fair value adjustments to contingent earnout obligations	—				375				1,488				375
Non-cash lease expense	953				—				3,823				—
Changes in operating assets and liabilities:
Accounts receivable	25,077				1,472				(27,827)				(15,585)
Commissions receivable	(81,747)				(54,910)				(332,936)				(197,364)
Other assets	500				(4,772)				4,848				(3,352)
Accounts payable and accrued expenses	(6,495)				2,776				19,728				15,672
Operating lease liabilities	(1,151)				—				(3,782)				—
Other liabilities	(4,768)				5,243				25,609				11,970
Net cash used in operating activities	(54,493)				(19,745)				(115,442)				(61,776)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment	(8,387)				(3,260)				(14,907)				(9,446)
Proceeds from sales of property and equipment	—				—				—				3
Purchases of software and capitalized software development costs	(2,275)				(1,663)				(8,081)				(6,106)
Acquisition of business	(17,150)				(35,821)				(41,028)				(35,821)
Net cash used in investing activities	(27,812)				(40,744)				(64,016)				(51,370)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving line of credit	—				2,014				—				87,989
Payments on revolving line of credit	—				(2,014)				—				(99,021)
Net proceeds from Term Loans	—				—				228,753				416,500
Payments on Term Loans	—				(100,000)				(84,118)				(100,000)
Proceeds from other debt	—				4,450				—				16,575
Payments on other debt	(62)				(29,015)				(251)				(31,447)
Proceeds from common stock options exercised and employee stock purchase plan	109				141				1,887				5,506
Cash dividends paid	—				—				—				(275,000)
Issuance of preferred stock	—				135,000				—				135,000
Payments of tax withholdings related to net share settlement of equity awards	(336)				—				(10,362)				—
Payments of debt issuance costs	—				(160)				(885)				(7,854)
Payments of costs incurred in connection with private placement	—				(3,784)				(1,771)				(3,784)
Payments of costs incurred in connection with initial public offering	—				(1,100)				(3,911)				(3,218)
Proceeds from initial public offering, net of underwriters’ discounts and commissions	—				340,200				—				340,200
Payment of contingent earnout liability	—				—				(32,300)				—
Net cash (used in) provided by financing activities	(289)				345,732				97,042				481,446
NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	(82,594)				285,243				(82,416)				368,300
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH—Beginning of year	369,048				83,627				368,870				570
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH—End of year	$	286,454			$	368,870			$	286,454			$	368,870

SELECTQUOTE, INC. AND SUBSIDIARIES Adjusted EBITDA to Net Income Reconciliation (Unaudited)
	4Q 2021
(in thousands)	Senior				Life				Auto & Home				Corp & Elims				Consolidated
Revenue	$	124,391			$	59,905			$	7,161			$	(3,008)			$	188,449
Operating expenses	(99,561)				(49,595)				(5,845)				(12,128)				(167,129)
Other expenses, net	—				—				—				(43)				(43)
Adjusted EBITDA	24,830				10,310				1,316				(15,179)				21,277
Share-based compensation expense																	(1,476)
Non-recurring expenses																	(575)
Depreciation and amortization																	(4,883)
Loss on disposal of property, equipment, and software																	(425)
Interest expense, net																	(8,422)
Income tax expense																	(2,184)
Net income																	$	3,312

	4Q 2020
(in thousands)	Senior				Life				Auto & Home				Corp & Elims				Consolidated
Revenue	$	87,865			$	42,423			$	12,127			$	(968)			$	141,447
Operating expenses	(54,478)				(30,165)				(9,023)				(7,633)				(101,299)
Other expenses, net	—				—				—				(10)				(10)
Adjusted EBITDA	33,387				12,258				3,104				(8,611)				40,138
Share-based compensation expense																	(216)
Non-recurring expenses																	(1,053)
Depreciation and amortization																	(2,720)
Loss on disposal of property, equipment, and software																	(125)
Contingent consideration																	(375)
Restructuring expenses																	(172)
Interest expense, net																	(8,356)
Loss on extinguishment of debt																	(1,166)
Income tax expense																	(5,906)
Net income																	$	20,049

SELECTQUOTE, INC. AND SUBSIDIARIES Adjusted EBITDA to Net Income Reconciliation (Unaudited)
	FY 2021
(in thousands)	Senior				Life				Auto & Home				Corp & Elims				Consolidated
Revenue	$	728,701			$	185,503			$	30,913			$	(7,302)			$	937,815
Operating expenses	(484,924)				(155,127)				(22,735)				(46,899)				(709,685)
Other expenses, net	—				—				—				(100)				(100)
Adjusted EBITDA	243,777				30,376				8,178				(54,301)				228,030
Share-based compensation expense																	(5,165)
Non-recurring expenses																	(6,065)
Fair value adjustments to contingent earnout obligations																	(1,488)
Depreciation and amortization																	(16,142)
Loss on disposal of property, equipment, and software																	(686)
Interest expense, net																	(29,320)
Loss on extinguishment of debt																	(3,315)
Income tax expense																	(34,803)
Net income																	$	131,046

	FY 2020
(in thousands)	Senior				Life				Auto & Home				Corp & Elims				Consolidated
Revenue	$	361,673			$	129,967			$	41,189			$	(1,314)			$	531,515
Operating expenses	(215,935)				(102,155)				(32,490)				(26,881)			(1)	(377,461)
Other expenses, net	—				—				—				(30)				(30)
Adjusted EBITDA	$	145,738			$	27,812			$	8,699			$	(28,225)			154,024
Share-based compensation expense																	(9,498)
Non-recurring expenses																	(3,721)
Depreciation and amortization																	(7,993)
Loss on disposal of property, equipment, and software																	(360)
Fair value adjustments to contingent earnout obligations																	(375)
Restructuring expenses																	(153)
Interest expense, net																	(24,595)
Loss on extinguishment of debt																	(1,166)
Income tax expense																	(25,016)
Net income																	$	81,147

 

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Williams-Sonoma, Inc. announces record second quarter results

Q2 revenues grow 30.7% with comparable brand revenue growth of 29.8%, 2YR comp of 40.3%

Q2 GAAP operating margin of 16.6%; Q2 Non-GAAP operating margin expansion of 360bps to 16.7%

Q2 GAAP diluted EPS of $3.21; Q2 Non-GAAP diluted EPS of $3.24, increasing 80%

Quarterly dividend increase of 20%; new stock repurchase authorization of $1.25 billion

Raises full-year 2021 and long-term outlook

SAN FRANCISCO–(BUSINESS WIRE)–
Williams-Sonoma, Inc. (NYSE: WSM), the world’s largest digital-first, design-led and sustainable home retailer, today announced operating results for the second fiscal quarter ended August 1, 2021 (“Q2 21”) versus the second fiscal quarter ended August 2, 2020 (“Q2 20”).

“We are proud to report another quarter of outperformance with a 30% comp, strong growth across all brands and channels, and 360 basis points of operating margin expansion. These second quarter results demonstrate the success of our growth strategies and the earnings power of our company. We have an advantage in the industry due to our exclusive in-house design capability, our channel strategy which is digital-first but not digital only, and our values – with sustainability and equity underlying all that we do,” said Laura Alber, President and Chief Executive Officer.

“The momentum we are seeing in our business and our winning positioning set us up to continue to take share in a fractured market. We do not see any evidence that growth trends are waning, and in fact, we see favorability in the macro environment as more people prioritize their homes and home décor. We believe we are at the intersection of a transformative change that will accelerate the growth of our industry, and our market share within the industry. In addition, our growth strategies are gaining traction faster than we predicted, and our key differentiators are further distancing us from our competition.” Alber continued.

Alber concluded, “We see a clear path to beating our previous revenue and profitability targets and we are raising our full year revenue outlook again, with revenue growth now expected to be in the high teens to low twenties and operating margins now expected to be in the range of 16% to 17%. Given our increased optimism, we now expect to achieve our long-term goal of $10 billion in revenues in 2024, one year faster than previously expected, and with higher profitability, which will now be at or above our increased FY21 operating margin.”

SECOND QUARTER 2021

• Revenues grow 30.7%, with strong growth across all brands and channels, including ecommerce holding at 65% of total company revenues
• Comparable brand revenue growth of 29.8%, including West Elm at 51.1%, Pottery Barn at 29.6%, Pottery Barn Kids and Teen at 18.0%, and Williams Sonoma at 6.4% on top of a 29.4% last year
• Ecommerce and retail comparable brand revenue growth on a two-year basis were 58.0% and 56.5%, respectively
• GAAP and non-GAAP gross margin of 44.1%, expanding 710bps and driven by higher year-over-year merchandise margins as well as occupancy leverage of approximately 210bps; occupancy costs were $176 million
• GAAP operating margin of 16.6%; non-GAAP operating margin of 16.7%, leveraging approximately 360bps
• GAAP diluted EPS of $3.21; non-GAAP diluted EPS of $3.24, increasing 80% over last year
• Maintaining strong liquidity position of $655 million in cash and over $475 million in operating cash flow, enabling the company to repurchase an additional $135 million in shares in the second quarter and over $450 million year-to-date. We also announced in a separate release today, an additional 20% quarterly dividend increase to $0.71, and a new stock repurchase authorization raising our existing authorization from the approximate $500 million remaining to $1.25 billion.

OUTLOOK

Fiscal Year 2021

Given the strength of our business year-to-date and the macro trends that we believe will continue to benefit our business, we are raising our fiscal year 2021 outlook to high-teens to low-twenties net revenue growth and non-GAAP operating margin between 16% to 17%.

Long-Term

For the long-term, we are planning for net revenue growth of mid-to-high single digits with an accelerated path to $10 billion in net revenues now over the next four years. Our continued strong results, combined with our three key differentiators of in-house design, digital-first channel strategy and values, and the macro trends that should benefit our business over the long-term, give us confidence in these future growth projections and an accelerated path to $10 billion in net revenues by 2024 while maintaining at least fiscal year end 2021 non-GAAP operating margins. This reflects reaching our long-term revenue outlook one year faster, and with higher profitability.

CONFERENCE CALL AND WEBCAST INFORMATION

Williams-Sonoma, Inc. will host a live conference call today, August 25, 2021, at 2:00 P.M. (PT). The call, hosted by Laura Alber, President and Chief Executive Officer, will be open to the general public via live webcast and can be accessed at http://ir.williams-sonomainc.com/events. A replay of the webcast will be available at http://ir.williams-sonomainc.com/events.

SEC REGULATION G — NON-GAAP INFORMATION

This press release includes non-GAAP financial measures. Exhibit 1 provides reconciliations of these non-GAAP financial measures to the most comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the U.S. (“GAAP”). We have not provided a reconciliation of non-GAAP guidance measures to the corresponding GAAP measures on a forward-looking basis due to the potential variability and limited visibility of excluded items; these excluded items may include expenses related to the impact of inventory write-offs, the acquisition of Outward, Inc., and asset impairment charges. We believe that these non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, can provide meaningful supplemental information for investors regarding the performance of our business and facilitate a meaningful evaluation of current period performance on a comparable basis with prior periods. Our management uses these non-GAAP financial measures in order to have comparable financial results to analyze changes in our underlying business from quarter to quarter. In addition, certain other items may be excluded from non-GAAP financial measures when the company believes this provides greater clarity to management and investors. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for or superior to the GAAP financial measures presented in this press release and our financial statements and other publicly filed reports. Non-GAAP measures as presented herein may not be comparable to similarly titled measures used by other companies.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or are proven incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Such forward-looking statements include statements relating to: our ability to capture significant opportunities in the home furnishings industry; increase our market share; macro trends; our ability to continue to improve performance; our focus on operational excellence; our ability to improve customers’ experience; our growth strategies; our optimism about the future; our ability to maximize growth and maintain high profitability; our fiscal year 2021 outlook and long-term financial targets, including projected net revenue growth and operating margin expansion; our stock repurchase program and dividend expectations; our planned capital investments; and our proposed store openings and closures.

The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include: continuing changes in general economic conditions, and the impact on consumer confidence and consumer spending; the continuing impact of the coronavirus on our global supply chain, retail store operations and customer demand; new interpretations of or changes to current accounting rules; our ability to anticipate consumer preferences and buying trends; dependence on timely introduction and customer acceptance of our merchandise; changes in consumer spending based on weather, political, competitive and other conditions beyond our control; delays in store openings; competition from companies with concepts or products similar to ours; timely and effective sourcing of merchandise from our foreign and domestic vendors and delivery of merchandise through our supply chain to our stores and customers; effective inventory management; our ability to manage customer returns; successful catalog management, including timing, sizing and merchandising; uncertainties in e-marketing, infrastructure and regulation; multi-channel and multi-brand complexities; our ability to introduce new brands and brand extensions; challenges associated with our increasing global presence; dependence on external funding sources for operating capital; disruptions in the financial markets; our ability to control employment, occupancy and other operating costs; our ability to improve our systems and processes; changes to our information technology infrastructure; general political, economic and market conditions and events, including war, conflict or acts of terrorism; the impact of current and potential future tariffs and our ability to mitigate impacts; the impact of inflation on consumer spending; the potential for increased corporate income taxes; and other risks and uncertainties described more fully in our public announcements, reports to stockholders and other documents filed with or furnished to the SEC, including our Annual Report on Form 10-K for the fiscal year ended January 31, 2021 and all subsequent quarterly reports on Form 10-Q and current reports on Form 8-K. We have not filed our Form 10-Q for the quarter ended August 1, 2021. As a result, all financial results described here should be considered preliminary, and are subject to change to reflect any necessary adjustments or changes in accounting estimates that are identified prior to the time we file the Form 10-Q. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we assume no obligation to update these forward-looking statements.

ABOUT WILLIAMS-SONOMA, INC.

Williams-Sonoma, Inc. is the world’s largest digital-first, design-led and sustainable home retailer. The company’s products, representing distinct merchandise strategies — Williams Sonoma, Pottery Barn, Pottery Barn Kids, Pottery Barn Teen, West Elm, Williams Sonoma Home, Rejuvenation, and Mark and Graham — are marketed through e-commerce websites, direct-mail catalogs and retail stores. These brands are also part of The Key Rewards, our free-to-join loyalty program that offers members exclusive benefits across the Williams-Sonoma family of brands. We operate in the U.S., Puerto Rico, Canada, Australia and the United Kingdom, offer international shipping to customers worldwide, and have unaffiliated franchisees that operate stores in the Middle East, the Philippines, Mexico, South Korea and India, as well as e-commerce websites in certain locations. We are also proud to lead the industry with our Environmental, Social and Governance (“ESG”) efforts. Our company is Good By Design — we’ve deeply engrained sustainability into our business. From our factories to your home, we’re united in a shared purpose to care for our people and our planet.

For more information on our ESG efforts, please visit: https://sustainability.williams-sonomainc.com/

WSM-IR

Condensed Consolidated Statements of Earnings (unaudited)
		Thirteen Weeks Ended														Twenty-six Weeks Ended
		August 1, 2021							August 2, 2020							August 1, 2021							August 2, 2020
						% of							% of							% of							% of
In thousands, except per share amounts		$				Revenues			$				Revenues			$				Revenues			$				Revenues
Net revenues		$	1,948,339			100	%		$	1,490,777			100	%		$	3,697,368			100	%		$	2,725,980			100	%
Cost of goods sold		1,089,951				55.9			939,575				63.0			2,086,127				56.4			1,760,518				64.6
Gross profit		858,388				44.1			551,202				37.0			1,611,241				43.6			965,462				35.4
Selling, general and administrative expenses		535,288				27.5			365,841				24.5			1,012,964				27.4			731,456				26.8
Operating income		323,100				16.6			185,361				12.4			598,277				16.2			234,006				8.6
Interest (income) expense, net		(39		)		—			6,464				0.4			1,833				—			8,623				0.3
Earnings before income taxes		323,139				16.6			178,897				12.0			596,444				16.1			225,383				8.3
Income taxes		77,069				4.0			44,333				3.0			122,572				3.3			55,396				2.0
Net earnings		$	246,070			12.6	%		$	134,564			9.0	%		$	473,872			12.8	%		$	169,987			6.2	%
Earnings per share (EPS):
Basic		$	3.29						$	1.73						$	6.29						$	2.19
Diluted		$	3.21						$	1.70						$	6.11						$	2.16
Shares used in calculation of EPS:
Basic		74,786							77,783							75,293							77,522
Diluted		76,584							79,264							77,516							78,841

	2nd Quarter Net Revenues and Comparable Brand Revenue Growth by Concept*
			Net Revenues								Comparable Brand Revenue
			(Millions)								Growth
			Q2 21				Q2 20				Q2 21			Q2 20
	Pottery Barn		$	732			$	563			29.6	%		8.1	%
	West Elm		580				381				51.1			7.0
	Williams Sonoma		255				243				6.4			29.4
	Pottery Barn Kids and Teen		274				236				18.0			4.8
	Other**		107				68				N/A			N/A
	Total		$	1,948			$	1,491			29.8	%		10.5	%
	* See the Company’s 10-K and 10-Q filings for the definition of comparable brand revenue, which is calculated on a 13-week to 13-week basis for Q2 2021 and Q2 2020. Comparable stores that were temporarily closed due to COVID-19 were not excluded from the comparable stores calculation. ** Primarily consists of net revenues from our international franchise operations, Rejuvenation and Mark and Graham.

Condensed Consolidated Balance Sheets (unaudited)
In thousands, except per share amounts		August 1, 2021				January 31, 2021				August 2, 2020
Assets
Current assets
Cash and cash equivalents		$	655,211			$	1,200,337			$	947,760
Accounts receivable, net		141,814				143,728				128,737
Merchandise inventories, net		1,170,561				1,006,299				1,042,340
Prepaid expenses		85,587				93,822				109,495
Other current assets		20,537				22,894				27,098
Total current assets		2,073,710				2,467,080				2,255,430
Property and equipment, net		875,295				873,894				887,401
Operating lease right-of-use assets		1,052,617				1,086,009				1,146,229
Deferred income taxes, net		58,848				61,854				37,789
Goodwill		85,421				85,446				85,419
Other long-term assets, net		99,146				87,141				75,028
Total assets		$	4,245,037			$	4,661,424			$	4,487,296
Liabilities and Stockholders’ equity
Current liabilities
Accounts payable		$	601,879			$	542,992			$	373,086
Accrued expenses		224,089				267,592				158,407
Gift card and other deferred revenue		403,409				373,164				292,684
Income taxes payable		61,335				69,476				28,502
Current debt		—				299,350				—
Borrowings under revolving line of credit		—				—				487,823
Operating lease liabilities		213,784				209,754				221,575
Other current liabilities		74,331				85,672				102,086
Total current liabilities		1,578,827				1,848,000				1,664,163
Deferred lease incentives		18,359				20,612				24,684
Long-term debt		—				—				298,995
Long-term operating lease liabilities		994,165				1,025,057				1,080,622
Other long-term liabilities		126,967				116,570				85,910
Total liabilities		2,718,318				3,010,239				3,154,374
Stockholders’ equity
Preferred stock: $0.01 par value; 7,500 shares authorized, none issued		—				—				—
Common stock: $0.01 par value; 253,125 shares authorized; 74,426, 76,340, and 77,796 shares issued and outstanding at August 1, 2021, January 31, 2021 and August 2, 2020, respectively		745				764				778
Additional paid-in capital		569,734				638,375				608,892
Retained earnings		964,000				1,019,762				736,772
Accumulated other comprehensive loss		(7,049		)		(7,117		)		(12,921		)
Treasury stock, at cost		(711		)		(599		)		(599		)
Total stockholders’ equity		1,526,719				1,651,185				1,332,922
Total liabilities and stockholders’ equity		$	4,245,037			$	4,661,424			$	4,487,296

	Retail Store Data
	(unaudited)
			May 2, 2021			Openings			Closings			August 1, 2021			August 2, 2020
	Williams Sonoma		195			3			(2	)		196			210
	Pottery Barn		195			1			(1	)		195			201
	West Elm		121			2			—			123			121
	Pottery Barn Kids		57			—			—			57			72
	Rejuvenation		10			—			—			10			10
	Total		578			6			(3	)		581			614

Condensed Consolidated Statements of Cash Flows (unaudited)
		Twenty-six Weeks Ended
In thousands		August 1, 2021				August 2, 2020
Cash flows from operating activities:
Net earnings		$	473,872			$	169,987
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization		96,687				93,120
Loss on disposal/impairment of assets		455				25,408
Amortization of deferred lease incentives		(2,254		)		(2,975		)
Non-cash lease expense		105,739				108,448
Deferred income taxes		(7,037		)		(2,229		)
Tax benefit related to stock-based awards		10,302				12,694
Stock-based compensation expense		46,260				33,395
Other		(274		)		255
Changes in:
Accounts receivable		2,002				(16,740		)
Merchandise inventories		(163,621		)		60,055
Prepaid expenses and other assets		(4,622		)		(30,968		)
Accounts payable		48,457				(141,602		)
Accrued expenses and other liabilities		(43,653		)		12,117
Gift card and other deferred revenue		30,308				2,936
Operating lease liabilities		(108,791		)		(113,489		)
Income taxes payable		(8,162		)		5,988
Net cash provided by operating activities		475,668				216,400
Cash flows from investing activities:
Purchases of property and equipment		(78,281		)		(76,123		)
Other		97				241
Net cash used in investing activities		(78,184		)		(75,882		)
Cash flows from financing activities:
Repurchases of common stock		(451,388		)		—
Repayment of long-term debt		(300,000		)		—
Tax withholdings related to stock-based awards		(100,160		)		(29,589		)
Payment of dividends		(91,069		)		(79,274		)
Borrowings under revolving line of credit		—				487,823
Debt issuance costs		—				(1,050		)
Net cash (used in) provided by financing activities		(942,617		)		377,910
Effect of exchange rates on cash and cash equivalents		7				(2,830		)
Net (decrease) increase in cash and cash equivalents		(545,126		)		515,598
Cash and cash equivalents at beginning of period		1,200,337				432,162
Cash and cash equivalents at end of period		$	655,211			$	947,760

	Exhibit 1
	2nd Quarter GAAP to Non-GAAP Reconciliation
	(unaudited)
	(Dollars in thousands, except per share data)
			Thirteen Weeks Ended												Twenty-six Weeks Ended
			August 1, 2021						August 2, 2020						August 1, 2021						August 2, 2020
			$			% of			$			% of			$			% of			$			% of
						revenues						revenues						revenues						revenues
	Gross profit		$	858,388		44.1	%		$	551,202		37.0	%		$	1,611,241		43.6	%		$	965,462		35.4	%
	Inventory write-off 1		—						—						—						11,378
	Non-GAAP gross profit		$	858,388		44.1	%		$	551,202		37.0	%		$	1,611,241		43.6	%		$	976,840		35.8	%
	Selling, general and administrative expenses		$	535,288		27.5	%		$	365,841		24.5	%		$	1,012,964		27.4	%		$	731,456		26.8	%
	Outward-related 2		(2,757		)				(3,341		)				(5,596		)				(6,699		)
	Asset impairment3		—						(6,355		)				—						(21,975		)
	Non-GAAP selling, general and administrative expenses		$	532,531		27.3	%		$	356,145		23.9	%		$	1,007,368		27.2	%		$	702,782		25.8	%
	Operating income		$	323,100		16.6	%		$	185,361		12.4	%		$	598,277		16.2	%		$	234,006		8.6	%
	Outward-related 2		2,757						3,341						5,596						6,699
	Inventory write-off1		—						—						—						11,378
	Asset impairment3		—						6,355						—						21,975
	Non-GAAP operating income		$	325,857		16.7	%		$	195,057		13.1	%		$	603,873		16.3	%		$	274,058		10.1	%
			$			Tax rate			$			Tax rate			$			Tax rate			$			Tax rate
	Income taxes		$	77,069		23.9	%		$	44,333		24.8	%		$	122,572		20.6	%		$	55,396		24.6	%
	Outward-related 2		462						451						973						1,192
	Inventory write-off 1		—						—						—						2,940
	Asset impairment 3		—						1,287						—						5,324
	Non-GAAP income taxes		$	77,531		23.8	%		$	46,071		24.4	%		$	123,545		20.5	%		$	64,852		24.4	%
	Diluted EPS		$	3.21					$	1.70					$	6.11					$	2.16
	Outward-related 2		0.03						0.04						0.06						0.07
	Inventory write-off 1		—						—						—						0.11
	Asset impairment 3		—						0.06						—						0.21
	Non-GAAP diluted EPS*		$	3.24					$	1.80					$	6.17					$	2.54
	∗ Per share amounts may not sum due to rounding to the nearest cent per diluted share

SEC Regulation G – Non-GAAP Information

These tables include non-GAAP gross profit, gross margin, selling, general and administrative expense, operating income, operating margin, income taxes, effective tax rate and diluted EPS. We believe that these non-GAAP financial measures provide meaningful supplemental information for investors regarding the performance of our business and facilitate a meaningful evaluation of our quarterly actual results on a comparable basis with prior periods. Our management uses these non-GAAP financial measures in order to have comparable financial results to analyze changes in our underlying business from quarter to quarter. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Notes to Exhibit 1:

1. During year-to-date 2020, we incurred approximately $11.4 million of inventory write-offs for inventory with minor damage that we could not liquidate through our outlets due to store closures resulting from COVID-19.
2. During Q2 2021 and year-to-date 2021, we incurred approximately $2.8 million and $5.6 million, respectively, associated with acquisition-related compensation expense and the amortization of acquired intangibles for Outward, Inc. During Q2 2020 and year-to-date 2020, we incurred approximately $3.3 million and $6.7 million, respectively, associated with acquisition-related compensation expense and the amortization of acquired intangibles for Outward, Inc.
3. During Q2 2020 and year-to-date 2020, we incurred approximately $6.4 million and $22.0 million, respectively, of expense associated with store asset impairments due to the impact that COVID-19 had on our retail stores.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20210825005697/en/

Julie Whalen EVP, Chief Financial Officer – (415) 616 8524

-or-

Investor Relations – (415) 616 8571

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Home Goods Online Retail Luxury Retail Specialty

MEDIA:

Posted on August 25, 2021 4:18 pm

America First Multifamily Investors, L.P. Extends Maturity of $50 Million Line of Credit

OMAHA, Neb., Aug. 25, 2021 (GLOBE NEWSWIRE) — On August 23, 2021, America First Multifamily Investors, L.P. (NASDAQ: ATAX) (the “Partnership”) entered into an Amended and Restated Credit Agreement (the “Amended Credit Agreement”) with Bankers Trust Company (“Bankers Trust”) for a secured non-operating line of credit (“Non-operating LOC”) with a maximum commitment of $50 million. The Amended Credit Agreement modifies certain provisions of the Partnership’s previous Credit Agreement with Bankers Trust dated May 14, 2015, as amended, including extension of the maturity date to June 30, 2023, and provides a first priority security interest in a custody account that will contain the Partnership’s investments purchased with advances on the Non-operating LOC. The Partnership also entered into a new Revolving Note which bears interest at the Wall Street Journal Prime Rate plus a margin.

“The Amended Credit Agreement continues our strong relationship with Bankers Trust. The $50 million Non-operating LOC is a great source of funding for our investment acquisitions and provides a valuable tool for managing our liquidity,” said Kenneth C. Rogozinski, Chief Executive Officer of the Partnership.

About America First Multifamily Investors, L.P.

America First Multifamily Investors, L.P. was formed on April 2, 1998 under the Delaware Revised Uniform Limited Partnership Act for the primary purpose of acquiring, holding, selling and otherwise dealing with a portfolio of mortgage revenue bonds which have been issued to provide construction and/or permanent financing for affordable multifamily, student housing and commercial properties. The Partnership is pursuing a business strategy of acquiring additional mortgage revenue bonds and other investments on a leveraged basis. The Partnership expects and believes the interest earned on these mortgage revenue bonds is excludable from gross income for federal income tax purposes. The Partnership seeks to achieve its investment growth strategy by investing in additional mortgage revenue bonds and other investments as permitted by the Partnership’s Amended and Restated Limited Partnership Agreement, dated September 15, 2015, taking advantage of attractive financing structures available in the securities market, and entering into interest rate risk management instruments. America First Multifamily Investors, L.P. press releases are available at www.ataxfund.com.

Safe Harbor Statement

Certain statements in this report are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by use of statements that include, but are not limited to, phrases such as “believe,” “expect,” “future,” “anticipate,” “intend,” “plan,” “foresee,” “may,” “should,” “will,” “estimates,” “potential,” “continue,” or other similar words or phrases. Similarly, statements that describe objectives, plans, or goals also are forward-looking statements. Such forward-looking statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Partnership. The Partnership cautions readers that a number of important factors could cause actual results to differ materially from those expressed in, implied, or projected by such forward-looking statements. Risks and uncertainties include, but are not limited to: risks involving current maturities of financing arrangements and our ability to renew or refinance such maturities, fluctuations in short-term interest rates, collateral valuations, mortgage revenue bond investment valuations and overall economic and credit market conditions; and the other risks detailed in the Partnership’s SEC filings (including but not limited to, the Partnership’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K). Readers are urged to consider these factors carefully in evaluating the forward-looking statements.

MEDIA CONTA
C
T:

Karen Marotta

Greystone

212-896-9149


[email protected]

INVESTOR CONTA
C
T:

Andy Grier

Senior Vice President

402-952-1235

Posted on August 25, 2021 4:18 pm

CVR Partners Announces Coffeyville Turnaround Deferral

SUGAR LAND, Texas, Aug. 25, 2021 (GLOBE NEWSWIRE) — CVR Partners, LP (“CVR Partners” or the “Partnership”) (NYSE: UAN) today announced that it currently intends to defer the scheduled turnaround at its Coffeyville, Kansas, nitrogen fertilizer facility from October 2021 to the third quarter of 2022. CVR Partners now expects its total forecasted turnaround spending for 2021 of approximately $8 million to $10 million of expense for the Coffeyville facility to be spent in 2022, which will be in addition to the planned 2022 turnaround for the Partnership’s East Dubuque nitrogen fertilizer facility.

“The health and safety of our employees, contractors and communities remains our critical priority,” said Mark Pytosh, President and Chief Executive Officer of CVR Partners’ general partner. “Between the recent spike in COVID-19 cases and the addition of Louisiana to Kansas’ travel quarantine list, we thought it prudent to reconsider the timing of this turnaround.

“Our proactive performance of maintenance activities during recent downtime events together with a planned short, opportunistic outage later in the year should enable us to safely defer this turnaround and complete the installation of the urea expansion project,” Pytosh said. “This turnaround deferral should also position us to capitalize on the strong margin environment we are currently seeing for both ammonia and UAN.”

CVR Partners will continue to monitor its marketing and operating conditions and make adjustments, if needed, to its turnaround and maintenance planning.

Forward-Looking Statements

This news release contains forward-looking statements. Statements concerning current estimates, expectations and projections about future results, performance, prospects, opportunities, plans, actions and events and other statements, concerns, or matters that are not historical facts are “forward-looking statements,” as that term is defined under the federal securities laws. These forward-looking statements include, but are not limited to, statements regarding future: turnarounds and maintenance activities including the cost, timing, impact and risks thereof; margin environment and our ability to capitalize on same; continued safe, reliable operations; and other matters. You can generally identify forward-looking statements by our use of forward-looking terminology such as “outlook,” “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “explore,” “evaluate,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “seek,” “should,” or “will,” or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. Investors are cautioned that various factors may affect these forward-looking statements, including (among others) the health and economic effects of the COVID-19 pandemic and any variant thereof, the rate of any economic improvements, impacts of planting season on our business, general economic and business conditions, and other risks. For additional discussion of risk factors which may affect our results, please see the risk factors and other disclosures included in our most recent Annual Report on Form 10-K, any subsequently filed Quarterly Reports on Form 10-Q and our other Securities and Exchange Commission (“SEC”) filings. These and other risks may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this news release are made only as of the date hereof. CVR Partners disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

About CVR Partners, LP

Headquartered in Sugar Land, Texas, CVR Partners, LP is a Delaware limited partnership focused on the production, marketing and distribution of nitrogen fertilizer products. It primarily produces urea ammonium nitrate (UAN) and ammonia, which are predominantly used by farmers to improve the yield and quality of their crops. CVR Partners’ Coffeyville, Kansas, nitrogen fertilizer manufacturing facility includes a 1,300 ton-per-day ammonia unit, a 3,000 ton-per-day UAN unit and a dual-train gasifier complex having a capacity of 89 million standard cubic feet per day of hydrogen. CVR Partners’ East Dubuque, Illinois, nitrogen fertilizer manufacturing facility includes a 1,075 ton-per-day ammonia unit and a 1,100 ton-per-day UAN unit.

For further information, please contact:

Investor Relations:
Richard Roberts
CVR Partners, LP
281-207-3205
[email protected]

Media Relations:
Brandee Stephens
CVR Partners, LP
281-207-3516
[email protected]

Posted on August 25, 2021 4:17 pm

HEXO Corp.’s Shareholders Overwhelmingly Approve Redecan Transaction and Senior Secured Convertible Note Financing Share Reserve

OTTAWA, Aug. 25, 2021 (GLOBE NEWSWIRE) — HEXO Corp (“HEXO” or the “Company”) (TSX: HEXO; NASDAQ: HEXO) is pleased to announce that at its meeting of shareholders held earlier today (the “Meeting”), holders (“Shareholders”) of common shares of HEXO (“Common Shares”) showed their overwhelming support of the previously announced acquisition of all of the outstanding shares of the entities that carry on the business of Redecan, Canada’s largest privately-owned licensed producer (the “Transaction”) in exchange for $400 million to be paid in cash in addition to the issuance of 69,721,116 Common Shares (the “Consideration Shares”), subject to certain customary adjustments. A total of 28,969,378 Common Shares (approximately 19% of the issued and outstanding Common Shares) were represented at the Meeting in person by virtual attendance or by proxy.

At the Meeting, Shareholders voted overwhelmingly in favour of the ordinary resolution (the “Transaction Resolution”) to, among other things, approve the issuance of the Consideration Shares pursuant to the Transaction. The Transaction Resolution was approved by 96.183% of the votes cast by Shareholders. In addition, Shareholders also voted overwhelmingly in favour of the ordinary resolution (the “Financing Resolution”) to approve the issuance of more than 32,198,894 Common Shares pursuant to the senior secured convertible note dated May 27, 2021 in the principal amount of US$360.0 million and due May 1, 2023 (the “Senior Secured Note”), representing more than 25% of the issued and outstanding Common Shares, and the issuance of Common Shares at a price less than the market price less any allowable discount (as determined by TSX rules) in the event that HEXO wishes to satisfy redemption and certain other payments under the Senior Secured Note in Common Shares. The Financing Resolution was approved by 94.992% of the votes cast by Shareholders. As previously announced, all regulatory approvals necessary for completion of the Transaction have been obtained. Completion of the Transaction remains subject to other customary conditions to closing and is expected to occur in the coming days.

About HEXO

HEXO is an award-winning licensed producer of innovative products for the global cannabis market. HEXO serves the Canadian recreational market with a brand portfolio including HEXO, UP Cannabis, Original Stash, Bake Sale, Namaste, and REUP brands, and the medical market in Canada, Israel and Malta. The Company also serves the Colorado market through its Powered by HEXO® strategy and Truss CBD USA, a joint-venture with Molson Coors. In the event that the previously announced transactions to acquire 48North and Redecan close, HEXO expects to be the number one cannabis products company in Canada by recreational market share.

For more information, please visit www.hexocorp.com.

Investor Relations:

[email protected]



www.hexocorp.com

Media Relations:

(819) 317-0526
[email protected]

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws (“forward-looking statements”). Forward-looking statements are based on certain expectations and assumptions and are subject to known and unknown risks and uncertainties and other factors that could cause actual events, results, performance and achievements to differ materially from those anticipated in these forward-looking statements. Forward-looking statements should not be read as guarantees of future performance or results. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company disclaims any intention or obligation, except to the extent required by law, to update or revise any forward-looking statements as a result of new information or future events, or for any other reason.

Neither the TSX, nor NASDAQ accepts responsibility for the adequacy or accuracy of this release.

Posted on August 25, 2021 4:16 pm

CenterPoint Energy seeks approval for 335 megawatts of renewable energy serving southwestern Indiana

– Company requests to purchase 335 megawatts (MW) in additional generating capacity from third-party solar projects in Indiana

– Proposed power purchase agreements represent the next component of company’s Smart Energy Future Plan

PR Newswire

EVANSVILLE, Ind., Aug. 25, 2021 /PRNewswire/ — CenterPoint Energy (NYSE: CNP) today announced its Indiana-based electric and natural gas business, CenterPoint Energy Indiana South, has filed a request for approval from the Indiana Utility Regulatory Commission (IURC) to enter into two power purchase agreements (PPAs) for an additional 335 megawatts (MWs) of solar energy as part of the next component in the company’s long-term electric generation transition plan.

The company is requesting approval to purchase 185 MWs of solar power, under a 15-year PPA, from Oriden, which is developing a solar project in Vermillion County, Ind., and 150 MWs of solar power, under a 20-year PPA, from Origis Energy, which is developing a solar project in Knox County, Ind. Subject to necessary approvals, both solar arrays are expected to be in service by 2023. The total 335 MWs from these developments is expected to supply enough power to meet the needs of more than 70,000 homes or 12,000 commercial customers per year.

“These additional renewable resources would serve our local electric customers, providing a cost-effective, stable energy option,” said Steve Greenley, Senior Vice President, Indiana Electric Operations for CenterPoint Energy. “We look forward to partnering with Oriden and Origis Energy as they bring these projects to fruition.”

In addition to the proposed PPAs, the company has filed and is awaiting an order on two other components of its electric generation transition plan. In February, the company filed a request with the IURC seeking approval to acquire a 300 MW solar array and an additional 100 MW PPA. In June, the company filed an application requesting approval to construct two natural gas combustion turbines to replace portions of its existing coal-fired generation fleet.

“Oriden is proud to support CenterPoint Energy’s efforts to diversify their electric generation portfolio and contribute to the future of cleaner energy for its customers,” said Masahiro Ogiso, President and CEO of Oriden. “It really takes a team effort with our stakeholders to develop a successful renewable energy project like this. We would like to thank the leadership team at the Vermillion Rise Mega Park and our partners in Vermillion County for supporting this important initiative.”  

The PPAs totaling 335 MWs represent the next component of the company’s Smart Energy Future Plan to meet stakeholder sustainability goals and implement a cost-effective, well-balanced energy mix for its 145,000 customers in southwest Indiana as outlined in last summer’s Integrated Resource Plan (IRP). In June 2020, CenterPoint Energy presented the IRP results, which illustrated a preferred portfolio including nearly two-thirds of energy generated from renewable resources and includes flexible generation to meet seasonal peak loads. The portfolio seeks to maintain continued reliability, while saving electric customers an estimated $320 million over the 20-year planning period.

Johan Vanhee, Chief Commercial and Procurement Officer with Origis Energy said, “We thank CenterPoint Energy for partnering with Origis Energy to acquire clean power from our solar project in Knox County. We look forward to the completion of the project to assist CenterPoint Energy in meeting the future energy needs of its southwestern Indiana electric customers.”  

Greenley added, “The additional energy obtained through the power purchase agreements will further CenterPoint Energy’s Smart Energy Future strategy. We’re pleased to be working with trusted developers in pursuit of continued renewable generation to support the communities we serve.”

CenterPoint Energy delivers electricity to approximately 145,000 customers in southwest Indiana in all or portions of Gibson, Dubois, Pike, Posey, Spencer, Vanderburgh and Warrick counties. Programs and services are operated under the brand CenterPoint Energy by Southern Indiana Gas and Electric Company d/b/a CenterPoint Energy Indiana South.

Forward Looking Statement
This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this news release, the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “goal,” “intend,” “may,” “objective,” “plan,” “potential,” “predict,” “projection,” “should,” “target,” “will” or other similar words are intended to identify forward-looking statements. These forward-looking statements are based upon assumptions of management which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Any statements in this news release regarding future events, such as the entry into and proposed regulatory approval of the two PPAs and timing thereof, the Company’s long-term electric generation transition plan and expected timing, benefits and generation mix resulting therefrom, expected timing of completion and power to be generated from the solar projects related to the two PPAs, anticipated cost savings and other benefits to customers, and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release. Important factors that could cause actual results to differ materially from those indicated by the provided forward-looking information include risks and uncertainties relating to: (1) the impact of COVID-19; (2) financial market conditions; (3) general economic conditions; (4) the timing and impact of future regulatory and legislative decisions; (5) effects of competition; (6) weather variations; (7) changes in business plans; and (8) other factors, risks and uncertainties discussed in CenterPoint Energy’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, CenterPoint Energy’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2021 and June 30, 2021 and other reports CenterPoint Energy or its subsidiaries may file from time to time with the Securities and Exchange Commission.

About CenterPoint Energy
As the only investor-owned electric and gas utility based in Texas, CenterPoint Energy, Inc. (NYSE: CNP) is an energy delivery company with electric transmission and distribution, power generation and natural gas distribution operations that serve more than 7 million metered customers in Arkansas, Indiana, Louisiana, Minnesota, Mississippi, Ohio, Oklahoma and Texas. As of June 30, 2021, the company owned approximately $36 billion in assets and also owned 53.7 percent of the common units representing limited partner interests in Enable Midstream Partners, LP, a publicly traded master limited partnership that owns, operates and develops strategically located natural gas and crude oil infrastructure assets. With approximately 9,500 employees, CenterPoint Energy and its predecessor companies have been in business for more than 150 years. For more information, visit CenterPointEnergy.com.

About Oriden
Located in Pittsburgh, Oriden develops, constructs, finances, owns and operates renewable energy projects throughout the United States. As local governments, public institutions and corporations prioritize cleaner sources for their energy needs, they want a developer with the ingenuity, the agility and the speed of a start-up — a fearless pioneer. But they also want to mitigate risk with a proven veteran that has the financial strength and experience to develop, commercialize, operate and own a highly complex project. Oriden is an authorized provider of the power solutions brand of Mitsubishi Power Americas, Inc., which has more than a century of experience manufacturing, servicing and providing power and energy solutions globally. For more information, visit the Oriden website and the Mitsubishi Power Americas website.

About Origis Energy
Origis Energy is bringing clean and cost effective solar and energy storage solutions within reach for utility, commercial and industrial as well as public sector clients. The Origis team has worked to ensure the interests of all stakeholders are upheld in 170 projects worldwide totaling more than 4 GW to date of developed solar and energy storage capacity. Headquartered in Miami, FL, Origis Energy delivers excellence in solar and energy storage development, financing, engineering, procurement and construction (EPC) and operations, maintenance and asset management for investors and clean energy consumers in the U.S.

For more information, contact
Media Relations
[email protected]

View original content to download multimedia:https://www.prnewswire.com/news-releases/centerpoint-energy-seeks-approval-for-335-megawatts-of-renewable-energy-serving-southwestern-indiana-301363047.html

SOURCE CenterPoint Energy, Inc.

Posted on August 25, 2021 4:15 pm

Ascendis Pharma A/S Reports Second Quarter 2021 Financial Results

– Announced U.S. Food and Drug Administration Approval of SKYTROFA



^®



(lonapegsomatropin-tcgd), the First Once-weekly Treatment for Pediatric Growth Hormone Deficiency –

– Exceeded target enrollment in Phase 3 PaTHway Trial for TransCon PTH (palopegteriparatide) in adults with hypoparathyroidism (HP); top-line results expected in Q1 2022 –

– Initiated combination therapy arm in transcendIT-101; TransCon TLR7/8 Agonist used in combination with a check point inhibitor (CPI) –

–


Conference call today at 4:30 p.m. Eastern Time


–

COPENHAGEN, Denmark, Aug. 25, 2021 (GLOBE NEWSWIRE) — Ascendis Pharma A/S (Nasdaq: ASND), a biopharmaceutical company that utilizes its innovative TransCon™ technologies to potentially create new treatments that make a meaningful difference in patients’ lives, today announced financial results for the second quarter ended June 30, 2021.

“We are actively preparing for the U.S. commercial launch of SKYTROFA for the treatment of children with GHD, which is now the first FDA-approved once-weekly treatment for pediatric GHD. SKTROFA is also the first FDA-approved product utilizing our innovative TransCon technology. Our pivotal heiGHt Trial demonstrated that once-weekly TransCon hGH increased annualized height velocity in treatment-naïve subjects at 52 weeks compared to a daily growth hormone with comparable safety and tolerability,” said Jan Mikkelsen, Ascendis Pharma’s President and Chief Executive Officer.   “We see this approval as the first step in creating a market leading product and building a fully integrated global biopharmaceutical company guided by our values of patients, science, and passion.”

Company Highlights & Progress

• TransCon hGH (lonapegsomatropin)
  • TransCon hGH is now FDA approved in the U.S. under the brand name SKYTROFA.   Continued preparation for commercial launch for the treatment of pediatric patients with GHD in the U.S.
  • European Commission decision on the company’s Marketing Authorisation Application (MAA) for the treatment of pediatric patients with GHD is anticipated in the fourth quarter of 2021.
  • Ongoing enrollment in the foresiGHt Trial, a global phase 3 trial in adults with GHD, and the riGHt Trial, a phase 3 trial in Japan in pediatric patients with GHD.
  • Patient follow-up continues in enliGHten, a multi-center phase 3, long-term open-label trial investigating safety and efficacy of SKYTROFA in pediatric patients with GHD.
  • Comprehensive results from the heiGHt Trial recently published on-line in the Journal of Clinical Endocrinology & Metabolism, an official journal of the Endocrine Society.
• TransCon PTH (palopegteriparatide)
  • Exceeded target enrollment in the PaTHway Trial, a phase 3 trial evaluating the safety, tolerability, and efficacy of palopegteriparatide in adult subjects with hypoparathyroidism with similar demographics as enrolled in the phase 2 trial including broad representation of different non-surgical disease etiologies and leading influential clinical sites balanced between North America and Europe.
  • On track to announce 84-week top line results from the open label extension (OLE) portion of the PaTH Forward Trial in the fourth quarter of 2021. Continued strong long-term subject retention with 58 out of the 59 randomized subjects continuing in the OLE portion of the trial as of August 23, 2021.
  • Clinical trial notification for the PaTHway Japan Trial was accepted by the Japanese Pharmaceuticals and Medical Device Agency. The single-arm, phase 3 study will enroll a minimum of 12 Japanese subjects with HP.
  • Received Orphan Drug Designation (ODD) from the Japanese Ministry of Health, Labor and Welfare.
  • VISEN Pharmaceuticals (VISEN) obtained investigational new drug (IND) approval to initiate the phase 3 PaTHway China Trial.
• TransCon CNP
  • Continued execution in the ongoing phase 2 ACcomplisH Trial and ACcomplisH China Trial to evaluate the safety and efficacy of TransCon CNP in children ages two to ten years with achondroplasia.
  • Clinical program update planned for the fourth quarter of 2021.
• TransCon TLR7/8 Agonist
  • Initiated combination therapy arm in transcendIT-101 with TLR7/8 Agonist and a CPI.
• TransCon IL-2 ß/y
  • IND filing on track for this quarter.
• Ended the second quarter of 2021 with cash, cash equivalents and marketable securities totaling €641.3 million.  

Second Quarter 2021 Financial Results

For the second quarter, Ascendis Pharma reported a net loss of €134.4 million, or €2.50 per share (basic and diluted) compared to a net loss of €94.9 million, or €1.97 per share (basic and diluted) for the same period in 2020.

Revenue for the second quarter was €1.0 million compared to €1.4 million in the same quarter of 2020. The decrease was due to a lower amount of license revenue being recognized, partly offset by higher sale of clinical supplies and services to VISEN and recognition of revenue from services rendered to another collaboration partner.

Research and development (R&D) costs for the second quarter were €83.3 million compared to €63.6 million during the same period in 2020. Higher R&D costs in 2021 reflect an increase in external development costs of the company’s product candidates and an increase in personnel-related costs.

Selling, general and administrative expenses for the second quarter were €35.3 million compared to €20.8 million during the same period in 2020. The increase is primarily due to higher personnel-related costs and an increase in IT costs.

Net loss of associate for the second quarter was €4.8 million compared to a net loss of €1.9 million in the same quarter of 2020. The net loss of associate represents our share of the net result from VISEN.

As of June 30, 2021, Ascendis Pharma had cash, cash equivalents and marketable securities of €641.3 million compared to €771.1 million as of March 31, 2021. As of June 30, 2021, Ascendis Pharma had 53,900,990 ordinary shares outstanding.

Conference Call Details

Date	Wednesday, August 25, 2021
Time	4:30 p.m. ET/1:30 p.m. Pacific Time
Dial In (U.S.)	844-290-3904
Dial In (International)	574-990-1036
Access Code	8553236

A live webcast of the conference call will be available on the Investors and News section of the Ascendis Pharma website at www.ascendispharma.com. A webcast replay will be available on this website shortly after conclusion of the event for 30 days.

About Ascendis Pharma’s Pipeline

Ascendis Pharma currently has three product candidates in clinical development in rare endocrine diseases and one oncology product candidate in clinical development:

• TransCon hGH (lonapegsomatropin-tcgd), an investigational long-acting prodrug of somatropin (human growth hormone or hGH) that releases somatropin with the identical amino acid sequence and size as daily growth hormone, is designed as a once-weekly treatment for GHD and is approved for pediatric GHD by the U.S. Food and Drug Administration and under review by the European Medicines Agency.
• TransCon PTH (palopegteriparatide), an investigational long-acting prodrug of parathyroid hormone (PTH) in phase 3 development as a once-daily replacement therapy for adults with hypoparathyroidism designed to replace PTH at physiologic levels for 24 hours, and address both short-term symptoms and long-term complications of the disease.
• TransCon CNP, an investigational long-acting prodrug of C-type natriuretic peptide (CNP) in phase 2 development as a therapy for children with achondroplasia (ACH), the most common form of dwarfism, for which there is no FDA-approved treatment. TransCon CNP is designed to provide continuous exposure of CNP at safe, therapeutic levels via a single, weekly subcutaneous dose.
• TransCon TLR7/8 Agonist is an investigational long-acting prodrug of resiquimod, a small molecule agonist of Toll-like receptors (TLR) 7 and 8. Administered as an intratumoral injection, TransCon TLR7/8 Agonist is designed to provide sustained activation of intratumoral antigen presenting cells driving tumor antigen presentation and induction of immune stimulatory cytokines in the tumor.
• TransCon IL-2 ß/y is an investigational long-acting prodrug of IL-2 ß/y designed for optimized IL-2R ß/y bias and potency, combined with low Cmax and long exposure.

About Ascendis Pharma A/S 

Ascendis Pharma is applying its innovative platform technology to build a leading, fully integrated biopharma company focused on making a meaningful difference in patients’ lives. Guided by its core values of patients, science and passion, the company utilizes its TransCon technologies to create new and potentially best-in-class therapies.

Ascendis Pharma currently has a pipeline of multiple independent endocrinology rare disease and oncology product candidates in development. The company continues to expand into additional therapeutic areas to address unmet patient needs.

Ascendis is headquartered in Copenhagen, Denmark, with additional facilities in Heidelberg and Berlin, Germany, in Palo Alto and Redwood City, California, and in Princeton, New Jersey.

Please visit www.ascendispharma.com (for global information) or www.ascendispharma.us (for U.S. information).

Forward-Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding Ascendis’ future operations, plans and objectives of management are forward-looking statements. Examples of such statements include, but are not limited to, statements relating to (i) Ascendis’ expectations regarding the U.S. commercial launch of SKYTROFA, (ii) Ascendis’ planned IND submission for TransCon IL-2 ß/y in the third quarter of 2021, (iii) Ascendis’ expectations regarding the European Commission’s decision on its Marketing Authorisation Application in the fourth quarter of 2021, (iv) Ascendis’ expectations regarding the announcement of top line results from the OLE portion of the PaTH Forward Trial in the fourth quarter of 2021, (v) Ascendis’ expectations regarding the announcement of top line results from the PaTHway Trial in the first quarter of 2022, (vi) Ascendis’ ability to apply its platform technology to build a leading, fully integrated biopharma company, (vii) Ascendis’ product pipeline and expansion into additional therapeutic areas and (viii) Ascendis’ expectations regarding its ability to utilize its TransCon technologies to create new and potentially best-in-class therapies. Ascendis may not actually achieve the plans, carry out the intentions or meet the expectations or projections disclosed in the forward-looking statements and you should not place undue reliance on these forward-looking statements. Actual results or events could differ materially from the plans, intentions, expectations and projections disclosed in the forward-looking statements. Various important factors could cause actual results or events to differ materially from the forward-looking statements that Ascendis makes, including the following: dependence on third party manufacturers to supply SKYTROFA, the SKYTROFA^® Auto-Injector and other study drug for commercial sales and clinical studies; unforeseen safety or efficacy results in its oncology programs, SKYTROFA, TransCon PTH and TransCon CNP or other development programs; unforeseen expenses related to commercialization of SKYTROFA and the further development of SKYTROFA, expenses related to the development and potential commercialization of its oncology programs, TransCon PTH and TransCon CNP or other development programs, selling, general and administrative expenses, other research and development expenses and Ascendis’ business generally; delays in the development of its oncology programs, SKYTROFA, TransCon PTH and TransCon CNP or other development programs related to manufacturing, regulatory requirements, speed of patient recruitment or other unforeseen delays; dependence on third party manufacturers to supply study drug for planned clinical studies; Ascendis’ ability to obtain additional funding, if needed, to support its business activities and the effects on its business from the worldwide COVID-19 pandemic. For a further description of the risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to Ascendis’ business in general, see Ascendis’ Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission (SEC) on March 10, 2021 and Ascendis’ other future reports filed with, or submitted to, the SEC. Forward-looking statements do not reflect the potential impact of any future in-licensing, collaborations, acquisitions, mergers, dispositions, joint ventures, or investments that Ascendis may enter into or make. Ascendis does not assume any obligation to update any forward-looking statements, except as required by law.

SKYTROFA, Ascendis, Ascendis Pharma, the Ascendis Pharma logo, the company logo and TransCon are trademarks owned by the Ascendis Pharma Group. © August 2021 Ascendis Pharma A/S.

FINANCIAL TABLES FOLLOW

Ascendis Pharma A/S
Consolidated Statements of Profit or Loss and Comprehensive Income / (loss)
(In EUR’000s, except share and per share data)
	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Revenue	1,022			1,436			1,767			3,661
Research and development costs	(83,306	)		(63,578	)		(171,455	)		(121,093	)
Selling, general and administrative expenses	(35,345	)		(20,805	)		(72,591	)		(38,720	)
Operating profit / (loss)	(117,629	)		(82,947	)		(242,279	)		(156,152	)
Share of profit / (loss) of associate	(4,817	)		(1,885	)		23,289			(3,400	)
Finance income	145			86			23,268			1,996
Finance expenses	(12,141	)		(10,292	)		(1,703	)		(876	)
Profit / (loss) before tax	(134,442	)		(95,038	)		(197,425	)		(158,432	)
Tax on profit / (loss) for the period	68			106			259			183
Net profit / (loss) for the period	(134,374	)		(94,932	)		(197,166	)		(158,249	)
Attributable to owners of the Company	(134,374	)		(94,932	)		(197,166	)		(158,249	)
Basic and diluted earnings / (loss) per share	€ (2.50)			€ (1.97)			€ (3.66)			€ (3.29)
Number of shares used for calculation (basic and diluted)	53,848,166			48,207,661			53,804,300			48,096,749
Net profit / (loss) for the period	(134,374	)		(94,932	)		(197,166	)		(158,249	)
Other comprehensive income / (loss)
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations	77			(147	)		1,765			(61	)
Other comprehensive income / (loss) for the period, net of tax	77			(147	)		1,765			(61	)
Total comprehensive income / (loss) for the period, net of tax	(134,297	)		(95,079	)		(195,401	)		(158,310	)
Attributable to owners of the Company	(134,297	)		(95,079	)		(195,401	)		(158,310	)

Ascendis Pharma A/S
Consolidated Statements of Financial Position
(In EUR’000s)
	June 30,		December 31,
	2021		2020
Assets
Non-current assets
Intangible assets	5,495		5,717
Property, plant and equipment	123,924		108,112
Investment in associate	45,783		9,176
Deposits	1,702		1,375
Marketable securities	90,693		115,280
	267,597		239,660
Current assets
Trade receivables	394		387
Other receivables	11,398		6,957
Prepayments	21,826		13,994
Marketable securities	166,094		134,278
Cash and cash equivalents	384,539		584,517
	584,251		740,133
Total assets	851,848		979,793
Equity and liabilities
Equity
Share capital	7,237		7,217
Distributable equity	680,250		831,494
Total equity	687,487		838,711
Non-current liabilities
Lease liabilities	94,059		85,116
Other liabilities	–		3,162
	94,059		88,278
Current liabilities
Lease liabilities	6,950		6,859
Contract liabilities	145		363
Trade payables and accrued expenses	44,207		21,897
Other payables	18,623		23,384
Income taxes payable	377		301
	70,302		52,804
Total liabilities	164,361		141,082
Total equity and liabilities	851,848		979,793

Investor contacts: Tim Lee  Ascendis Pharma (650) 374-6343  [email protected]	Media contact: Melinda Baker Ascendis Pharma (650) 709-8875 [email protected]
Patti Bank  Westwicke Partners  (415) 513-1284  [email protected]  [email protected]